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Time to sell?

October 31, 2021 By Tayson Rockefeller Leave a Comment

I’ll try to keep this article generic so that it is relevant in years to come, but in so many ways much of this information will likely be outdated before we know it. One thing is for sure, this market has had so many unexpected twists and turns that the craziness now seems to be normal, and it probably is normal until the next crazy happens… You know how it goes.

The inspiration for my article was an advertisement I saw on behalf of one of my realtor friends on social media in another area. It was something like looking to sell? It’s a great time to sell! Are you looking to buy? It’s a great time to buy as well! Of course, this could have been handled differently and they could have talked about the low interest rates for buyers and the obvious hot market for sellers but it didn’t really come out that way. From a marketing standpoint, I think it’s difficult to group everybody into one advertisement like this. Generally speaking, buyers buy when they want to buy. It doesn’t matter if it’s a seller’s market and they know it, or if it’s a buyer’s market and the value is easy to justify. I can look back through my career with dozens and dozens of potential buyers that always felt the market was overvalued. They are always going to feel that way. I can also remember buyers that seems to be making an impulse decision that didn’t seem to make sense. Sometimes that worked out, sometimes it didn’t. As always, my job is to provide data, facts, and information. Unless it is overwhelmingly clear I generally won’t answer the question of “Is it a good time to buy?”. Besides, buyers want to make their own decisions, they just want to hear straight information.

But is it a good time to sell? Is it ever a good time to sell? It depends who you ask. Most stock brokers will talk about averaging. Investments tend to increase over time, hang on, hang out and let the world do its thing. Is it a good time to sell if you don’t have anywhere to go? Not really. Is it a good time to sell if you are planning to do so? How about if you have a real estate investment that isn’t providing a great return? How about one that you are tired of maintaining or otherwise don’t need? To those questions, I would probably say, yes. Here again, probably not directly (which I seem to have done here) but I would mention some indicators that would point to the appropriate timing for such a task if it were a consideration. First, foremost and always – supply and demand. There was a weird time in October of 2020 after the craze where all of the land inventory was totally wiped out. While land in some areas has seemed to increase since then, so has the supply. As a result some land listings have stagnated despite the overall market continuing to perform well. Regardless, we saw an enormous bump in land real estate values during that time. On a side note, I’ve said this more times than I can count, land was too cheap for too long and that contributed to what happened in October. Anyway, when inventory gets tight, people tend to spend more. Getting back to the buyer thing, when people decide they want something, they pursue it and buy it. We’re all guilty of it. The starter goes out on your car. You start to have thoughts of the next thing, what’s the next big expense? You start looking at options. At that point, I would say with relative certainty, you’re probably going to buy a new car. If the automotive market seemed to be at a point where inventory was tight and things were more expensive than they should be, would you overspend to buy that car? Probably. A lot of people are looking at real estate right now, and there isn’t much available. We seem to have hit the inventory levels comparable to what we were seeing with land a year ago mentioned above. There’s also some uncertainty in the markets (although there always seems to be) and we only know what we know, now. Getting back to it, is the market going to hold? Are values going to increase? No clue. What I can tell you is that values are high, now. If you’re in that category and you’re planning on selling when the time is right, think about it.

To be clear, I am definitely not sounding any alarms. Most local real estate professionals and those with a close ear to the ground in the financial sector agree that this market still holds steam, and a lot has changed in ways from how the lending market works with protections in place to the clear indications that our little paradise has finally been discovered. Not as many people are “finding” Teton Valley through Jackson, they are traveling and investing here because we are a destination.

Changing the way we negotiate

May 3, 2021 By Tayson Rockefeller Leave a Comment

I distinctly recall hearing stories from customers in different areas of the country before the recent real estate boom changed the real estate world, particularly in rural areas. Stories about negotiations pushing home prices 10% over the asking price seemed pretty crazy to me, but in some cases, here we are.

It’s important to look at the date on this article, this information is likely going to be accurate only for a few months, but it’s good to earmark where things have been. I’ve got articles from 2014 with much different advice.

Price: Asking prices and offer amounts seem to change weekly, if not daily in this market. With the lack of public sale information and the unknown as to how far things are selling over the asking price this one’s hard to nail down without the advice of an agent that is in the thick of current trends. I have seen sale prices anywhere from $5,000 to 15% over the asking price depending on the sector of the market. We will usually see significant increases over asking on condos and townhouses, but that does not preclude any other type of Real Estate depending on the initial asking price. I should also note that some things are still selling under, it’s all about the tactic of the seller.

Finance and Appraisal: This one has been incredibly tough for buyers looking to get into the market. It’s frustrating and disheartening when a finance contingency is holding up the ability to compete with cash buyers. As a result, we’ve seen buyers agree to waive appraisal contingencies, assuming they have the cash balance to cover the difference. Waiving appraisal contingency and providing a pre-qualification letter with 5% down is difficult, but we haven’t seen too many problems with appraisals. Appraisers seem to be in the know with real estate prices. However, cash is still king, and hard to compete with as mentioned.

Inspection: Fortunately we haven’t seen a shift in our market where buyers have been (or need to) waving inspection contingencies in order to compete. Deposits that are immediately non-refundable are rare, and personally, I hope it stays that way. These are big investments and buyers need the opportunity to vet properties inside and out. This market also produces a number of site-unseen offers (often there is no choice with the quick timing of things) and I believe it would be unreasonable for sellers to expect buyers to waive contingencies altogether as a result.

There are a handful of other negotiating tips and tricks like escalation clauses and the like, and there’s a time and place for different tactics to achieve maximum results. I know I sound like a scumbag real estate agent when I say this, but as mentioned above, it’s absolutely paramount to have a local agent that has a close ear to the ground.

It will be fun to come back to this article 2 years from now!

Beware of Unsolicited Offers!

February 28, 2021 By Tayson Rockefeller Leave a Comment

Generally speaking, it’s no secret that Teton Valley’s real estate market is booming. In times like these, those looking to capitalize or at least get their foot in the door are out in droves doing what they can to get a deal. I have noticed a significant increase in “letters of intent” to purchase real estate, cold calls, and other forms of communication from those I described above.

Some of these are pretty easy to pick out, and most have a general understanding of their property’s value to recognize that these are borderline scam prices. However, in times like this, the market values change very quickly. While I have seen some laughable offers, I have also seen a few that appear pretty enticing on the surface. However, it’s important to remember that these people are contacting you for a reason. The market is strong, and it is almost an assurance that a good agent can help you sell your property, quickly. With that said, there is no advantage to considering a one-off offer in almost any event. Some exceptions might include neighbors offering to buy real estate, knowing that neighbors are usually the most motivated buyers in the marketplace.

I always joke about “scumbag” realtors, but the truth is, our region has some of the most responsible, well intended, and market educated professionals that I have seen in the industry. There’s always an exception, but I suspect that there is concern that trying to communicate with a real estate agent or obtain a fair opinion of value without being pressured to list your property can be challenging, but that’s really not the case. Most agents or local market professionals offer a quick, no frills opinion of value at no cost and with no strings attached. We do these valuations all the time for customers trying to understand tax rates, situations with family members, and so forth. If you’re really looking for a non-biased opinion, even paying an appraiser to give you a market value could save you significantly if you are considering an unsolicited offer from an individual. These offers come in many forms, but they will usually come in the mail. However, phone calls, emails, or even door to door solicitations should be expected.

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